Irrevocable Life Insurance Trusts

Irrevocable Life Insurance Trusts, frequently referenced as ILITs, are Advanced Estate Planning tools that allow clients to avoid a common mistake: the inclusion of life insurance proceeds in their taxable estate upon death.

Many clients incorrectly assume that because life insurance proceeds are not considered to be income for income tax purposes that they are not taxable by the government at all; however, if a life insurance policy is owned by that client when they pass away, the proceeds will be subject to hefty Estate Taxes.

ILITs can be an excellent way for a client who is already exposed to Estate Tax liability to remove the burden of those taxes from their heirs by purchasing an insurance policy to cover those prospective costs and placing it in an ILIT.

Avoid Estate Tax Liability

ILITs help clients avoid Estate Tax liability on the proceeds of life insurance policies by removing “incidents of ownership” that the client may have regarding the policies. ILITs are a kind of Irrevocable Trust, meaning that the client will not be able to modify or revoke the trust in any way once it is created and funded; removing incidents of ownership and allowing the beneficiaries to receive life insurance benefits free from Estate Taxes.

ins-smILITs can be an excellent way for a client who is already exposed to Estate Tax liability to remove the burden of those taxes from their heirs by purchasing an insurance policy to cover those prospective costs and placing it in an ILIT. Other clients can use ILITs to simply increase the amount of inheritance left to their heirs through life insurance proceeds: this is an extremely flexible solution.

The attorneys of Bezaire, Ledwitz & Associates have the knowledge and experience—many of our attorneys are licensed Life Insurance Agents—to appropriately advise clients on whether they should utilize an ILIT to achieve their estate planning goals.

Upcoming Zoom Seminars Concerning Changes to Tax Laws.

We understand that face-to-face meetings is not ideal at this time. We want to make sure that you stay informed about several changes to the tax and estate laws.

We will have a series of virtual seminars held by Samuel B. Ledwitz over the next few months to keep you are aware how you can reduce your Tax Liability before changes take place in the tax code.

Please contact us at Info@ledwitzlaw.com if you are interesting in attending seminars and workshops that will help you best prepare.

COVID-19 Information

We are open for both In-Person and Virtual Meetings.

Our office and staff are well equipped  and follow all proper safety measures to have a safe in-person meeting.

We also have Zoom capabilities as well as other popular programs to have a comprehensive virtual meeting with you.

 

Need help planning for the future?

 

Call us for a free consultation at 310-316-2400,

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